A black market in cattle sales and a lack of compliance with the National Animal Identification and Tracing (NAIT) regime by farmers is hampering the Ministry for Primary Industries' efforts to respond to Mycoplasma bovis, which is now New Zealand's largest animal surveillance issue.

"We do have, unfortunately, quite a black market of cows sold for cash," Geoff Gwyn, director of readiness and response at the Ministry for Primary Industries, told the primary production committee at the parliament today. "We're looking at bank records, taking affidavits."

Gwyn and other MPI officials were giving a briefing on the disease to the select committee. Head of Biosecurity New Zealand Roger Smith said it had been "a very challenging incursion response" because of the level of non-authorised stock movements and modern farm practices which meant cows were frequently moved to where the grass was best.

It was also a challenge because unlike a disease such as foot and mouth, there could be little outward sign of infection, and may display as a secondary illness such as mastitis or pneumonia, he said. "It's a very difficult disease to find. You could have perfectly healthy animals that showed no signs" of the disease. Definitive testing took 60 days unless the animal was dissected. "You have to take the head off the animal."

As of the start of this month, MPI had paid a total of $3.3 million in compensation to 22 farmers and has previously estimated the outbreak could cost about $95 million in tracking and tracing the spread of the disease and paying compensation to farmers, of which $60 million was the anticipated claims liability.

Some 22,000 cows are being culled, with about 11,000 animals destroyed so far. As of today, 38 farms were actively infected, 77 were under a restricted place notice and 225 were under notice of direction, a slightly lesser restriction. Almost 1,700 properties were deemed of interest because of risk events or because they were adjacent to infected properties.

Developments in the past six days had been a game changer in terms of the spread of the disease with confirmed infection in North Canterbury - a new region - and on a second North Island at near Pahīatua.

"In the last six days the spread has been totally above all expectations," Smith said. "Six days ago we had 129 properties under some sort of regulation control - in the last six days, we have moved that to 299."

Based on genotyping work, all the infections were the same strain of Mycoplasma bovis, with three clusters of infection within the network. While MPI understood that farmers wanted to maximise the value of their cows and grass, "it is fair to say not all stock movements are being well-documented," Smith said. In particular, there was a poor record of NAIT tracing of calf movements "and calves are a vector for the disease."

In some cases a farmer would have a record of a calf being born but no information on where it went. "If they have gone to the dairy herd, they may show up (with the disease) in three years," he said.

Tracing puts December 2015 as the earliest date of introduction to New Zealand. There was currently no conclusive evidence what pathway it took, Gwyn said, adding that in his experience it would be difficult to identify its origin overseas. Because the disease was endemic in other countries and not considered a particular threat, MPI's counterparts in other countries didn't have the same DNA databases that they tended to hold for diseases such as Foot and Mouth, he said.

MPI is currently working on recommendations from a review of NAIT and expects to make recommendations on the best way to respond to Mycoplasma bovis in coming weeks. While all options were still on the table, developments in recent days meant MPI was looking more seriously at long-term management and containment, rather than eradication.

Acting committee chair and former MPI minister Nathan Guy said at the briefing that some meat processors were charging $200 per animal to process infected cattle, which Gwyn said reflected the requirement for decontamination at the plant. Guy also asked whether MPI could provide a "letter of intent" to rural lenders worried about the weakened finances of an infected farm, but Smith said while the ministry was happy to meet with a farmer and their bank, it wouldn't provide a letter because of potential liabilities before compensation was set.

Gwyn said he wasn't aware of any restricted farm being foreclosed by its bank, to which Guy said: "Well, the caveat is yet."

Asked after the briefing to elaborate on the black market trade, Gwyn said it was "a small minority of farmers that sell calves for cash - so there's no record."

The MPI officials said the about 1 million cows are culled each year so the primary sector could cope with 22,000 being culled for this disease. It was no more than the cull that might occur in a drought. MPI was aiming to give affected farmers room the replace infected animals as quickly as possible to restore their cash flow.